In comments today, Civil Aviation Minister Jyotiraditya Scindia pushed Indian airlines to add more widebody planes to their fleet and increase international destinations. His statement comes as foreign carriers dominate international traffic and the country sees little investment in long-haul aircraft. However, there is a reason behind this and here’s what needs to change.
India has less than 50 widebodies in operation
As India inches closer to reopening international flights to pre-pandemic standards, the spotlight is back on the inequity of traffic distribution. Only two Indian airlines, Air India and Vistara, operate widebody aircraft needed to fly to much of Europe, North America, the Far East, and Oceania.
The flag carrier actively operates 43 widebodies (27 Boeing 787s and 16 777s) while newcomer Vistara flies two 787s (four on order). For a market of nearly 70 million annual international travelers (2018), this represents a fraction of the capacity required to dominate the market. Jyotiraditya Scindia wants airlines to change this with new orders for widebodies.
Airbus came to show off its A350-900 in Delhi and Hyderabad last week as it hopes to end Boeing’s control of the market. Photo: Gaurav Joshi | Simple Flying
In a statement today at the Wings India Air Show, he said,
“Along with our thrust on narrow body aircraft, we must also increase our fleet of wide body aircraft. It is not enough to connect all points in India, we need to connect the world to India.”
But here is why Indian airlines have been avoiding this move.
The Indian market is run by hub airlines
The reason behind India’s few widebodies is not a lack of demand, it’s an abundance of cheaper supply. The market today is run by Middle Eastern super connectors like Emirates, Qatar Airways, and Etihad (known as the ME3). The ME3 held a market share of 17.1% in 2019-20, ahead of Air India’s 11.6% and IndiGo’s 11.5%.
While this doesn’t seem like a large gap, the hub carriers have cornered traffic into Europe and North America, the key markets which need widebody planes. By offering services to 10+ cities, these airlines can charge far lower fares than local competitor Air India and snatch any non-metro traffic with ease.
Emirates operates over 170 weekly flights from nine cities in India come April 1st, restoring pre-pandemic networks. Photo: Getty Images
Previously, Jet Airways attempted to compete with ME3 by expanding globally with leased 777s and A330s but quickly started making heavy losses. Despite Etihad eventually picking up a stake in Jet, in exchange for lucrative landing slots, Jet folded in 2019 and only handed more of the market to the ME3. Combined with Air India’s struggling business left a stern message to Indian airlines: don’t try to compete with hub carriers on international routes. So, can this change?
Adding more planes is part of the equation
Boosting market share for Indian airlines is a chicken and egg situation. To grow traffic, airlines need widebodies and to justify more planes, they need more passengers. However, with the Tata’s purchasing Air India and Vistara, the nation finally has a company that has the means to buy more planes and challenge connecting airlines by launching new routes. The pandemic showed us that there is no shortage of demand for direct flights; hopefully, the post-pandemic era will see carriers be able to take advantage of this.
What do you think about new widebodies in India? Let us know in the comments!
Source: Reuters.
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